Turtle Beach Corporation Announces Growth in Revenue, Adjusted EBITDA and Gross Margins in First Quarter 2025 Results and $75 Million Share Repurchase Program
Director, Global CommunicationsTurtle Beach Corporation(858) 914-5093maclean.marshall@turtlebeach.com Turtle Beach CorporationCondensed Consolidated Statements of Operations(in thousands, except per-share data)(unaudited)Table 1. Three Months Ended March 31, March 31, 2025 2024 Net revenue $63,901 $55,848 Cost of revenue 40,534 38,062 Gross profit 23,367 17,786 Operating expenses: Selling and marketing 12,453 9,013 Research and development 3,993 3,902 General and administrative 8,216 5,674 Insurance recovery (3,439) - Acquisition-related cost 608 4,910 Total operating expenses 21,831 23,499 Operating income (loss) 1,536 (5,713)Interest expense 2,006 150 Other non-operating expense, net 303 370 Loss before income tax (773) (6,233)Income tax expense (benefit) (109) (6,388)Net income (loss) $(664) $155 Net loss per share Basic $(0.03) $0.01 Diluted $(0.03) $0.01 Weighted average number of shares: Basic 20,506 18,321 Diluted 20,506 19,389 Turtle Beach CorporationCondensed Consolidated Balance Sheets(in thousands, except par value and share amounts)Table 2. March 31, December 31, 2025 2024 (unaudited) ASSETS Current Assets: Cash and cash equivalents $11,684 $12,995 Accounts receivable, net 42,354 93,118 Inventories 73,664 71,251 Prepaid expenses and other current assets 14,533 11,007 Total Current Assets 142,235 188,371 Property and equipment, net 4,884 5,844 Goodwill 50,428 52,942 Intangible assets, net 40,382 42,398 Other assets 9,095 9,306 Total Assets $247,024 $298,861 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities: Revolving credit facility $6,592 $49,412 Accounts payable 39,539 34,839 Other current liabilities 26,294 39,421 Total Current Liabilities 72,425 123,672 Debt, non-current 45,544 45,620 Income tax payable 1,367 1,362 Other liabilities 6,814 7,603 Total Liabilities 126,150 178,257 Commitments and Contingencies Stockholders’ Equity Common stock 20 20 Additional paid-in capital 240,150 239,983 Accumulated deficit (118,758) (118,094)Accumulated other comprehensive loss (538) (1,305)Total Stockholders’ Equity 120,874 120,604 Total Liabilities and Stockholders’ Equity $247,024 $298,861 Turtle Beach CorporationCondensed Consolidated Statements of Cash Flows(in thousands)(unaudited)Table 3. Three Months Ended March 31, 2025 March 31, 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net (loss) income $(664) $155 Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities: Depreciation and amortization 1,110 916 Amortization of intangible assets 2,016 560 Amortization of debt financing costs 276 70 Stock-based compensation 1,912 1,105 Deferred income taxes (445) (6,716)Change in sales returns reserve 1,873 (2,410)Provision for obsolete inventory 486 794 Changes in operating assets and liabilities, net of acquisitions: Accounts receivable 48,891 35,918 Inventories (2,899) (3,063)Accounts payable 4,716 8,065 Prepaid expenses and other assets (3,473) (357)Income taxes payable (1,401) 2 Other liabilities (11,946) (7,782)Net cash provided by operating activities 40,452 27,257 CASH FLOWS FROM INVESTING ACTIVITIES Purchases of property and equipment (166) (731)Acquisition of a business, net of cash acquired 2,515 (75,494)Net cash provided by (used for) investing activities 2,349 (76,225)CASH FLOWS FROM FINANCING ACTIVITIES Borrowings on revolving credit facilities 65,276 80,288 Repayment of revolving credit facilities (108,096) (80,288)Proceeds of term loan - 50,000 Repayment of term loan (312) (104)Proceeds from exercise of stock options and warrants 5 1,257 Repurchase of common stock (1,750) - Debt issuance costs - (3,170)Net cash provided by (used for) financing activities (44,877) 47,983 Effect of exchange rate changes on cash and cash equivalents 765 75 Net decrease in cash and cash equivalents (1,311) (910)Cash and cash equivalents - beginning of period 12,995 18,726 Cash and cash equivalents - end of period $11,684 $17,816 Turtle Beach CorporationGAAP to Adjusted EBITDA Reconciliation(in thousands)Table 4. Three Months Ended March 31, 2025 2024 (in thousands) Net (loss) income $(664) $155 Interest expense 2,006 150 Depreciation and amortization 3,126 1,476 Stock-based compensation 1,912 1,105 Income tax benefit (1) (109) (6,388)Restructuring expense (2) 5 41 Acquisition-related expense (3) 608 4,910 Insurance recovery (4) (3,439) — Loss on inventory in transit and other costs (5) 605 — Adjusted EBITDA $4,050 $1,449 (1)An income tax benefit of $7.0 million was recorded in the three months ended March 31, 2024 as a result of the reversal of a portion of the Company’s deferred tax asset valuation allowance.(2)Restructuring charges are expenses that are paid in connection with reorganization of our operations.
–Net Revenue of $63.9 million, up 14% compared to prior year––Gross Margin improved to 36.6%, an increase of approximately 470 basis points compared to prior year––Net Loss of $(0.7) million compared to Net Income of $0.2 million in prior year––Adjusted EBITDA of $4.1 million, up from $1.4 million in prior year––Generated $40.5 million in cash flow from operations, the highest level since 2019––Authorized a new $75 million stock repurchase program– SAN DIEGO, May 08, 2025 (GLOBE NEWSWIRE) -- Turtle Beach Corporation (Nasdaq: TBCH), a leading gaming accessories brand, today reported strong financial results, including growth in revenue, Adjusted EBITDA, and gross margins in the first quarter ended March 31, 2025.
Some of these factors include, but are not limited to, risks related to trade policies, including the imposition of tariffs on imported goods and other trade restrictions, the release and availability of successful game titles, macroeconomic conditions affecting the demand for our products, logistic and supply chain challenges and costs, dependence on the success and availability of third-parties to manufacture and manage the logistics of transporting and distributing our products, the substantial uncertainties inherent in the acceptance of existing and future products, the difficulty of commercializing and protecting new technology, the impact of competitive products and pricing, general business and economic conditions, risks associated with the expansion of our business including the integration of any businesses we acquire and the integration of such businesses within our internal control over financial reporting and operations, our indebtedness, liquidity, and other factors discussed in our public filings, including the risk factors included in the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, and the Company’s other periodic reports filed with the Securities and Exchange Commission.
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